Offshoring Research Network

The Offshoring Research Network (O.R.N.) is a global network which aims is to encourage knowledge improvements about the offshoring phenomenon, through constant interaction between academics and entrepreneurs.

Coordinated by Duke University (North Carolina, USA), the network gathers together a wide group of universities from around the world in a joint endeavor which seeks to disentangle the benefits and risks behind offshoring practices.

IESE Business School, through the Center for Globalization and Strategy, carries out the Spanish chapter of this worldwide research venture.

Offshoring refers to the practice undertaken by companies of migrating activities to offshore locations outside their countries of origin. Companies, mainly in western economies, have historically adopted an offshore strategy predominantly for manufacturing work and blue-collar jobs. Only recently, thanks to the substantial progress in information and communication technologies, a novel type of offshoring has emerged.

In fact, companies now have the potential to relocate a number of business processes (e.g., call-center customer support, transaction processing and data management) that until only a few decades ago were considered classic white-collar jobs to be performed exclusively at home. Even though this new kind of offshoring can still be considered a recent phenomenon, as the proportion of actual versus potential offshored business processes remains small, its forecasted future impact on the global realignment of jobs urges us to investigate it thoroughly.

Offshoring is closely related to another well-known business practice: outsourcing. Yet, whereas the latter only refers to activities or functions being carried out exclusively by third party providers, offshoring processes can involve a third party at times or a subsidiary company on some other cases. Outsourcing mainly relates to those non-core business activities which are usually managed by more specialized and larger companies.

The objective of this study is to shed some light on the offshoring phenomenon from a Spanish perspective. In particular, to understand the drivers behind Spanish offshoring, and to detect the different dynamics created in the local labor market. Offshoring and the related global talent sourcing are projected to have a significant impact, especially on those labor markets relative to knowledge-intensive activities, that can be easily performed in remote locations.

The purpose of this work is precisely to understand the drivers and the effects behind offshoring practices for the Spanish market. Other partners will look into the offshoring phenomenon in their respective countries.

The research will use data collected in the online questionnaire set up by the Offshoring Research Network (ORN) project. ORN was launched in 2004 at Duke University, Center for International Business Education and Research (CIBER), Fuqua School of Business. In 2004 and 2005 ORN focused on surveying the offshoring practices of U.S. based companies, in 2006 the research was extended to Europe. Six leading Universities of different European countries recruited companies to participate in the project and replicated the U.S. survey in the European context. Our study will focus on the data generated by the Spanish pool of survey-respondents in the last couple of years. Finally, a report is expected to be issued and shared with all respondents in a series of seminars and meetings which will be held at IESE.